FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The New Zealand Small Business Loans
Let me know about the New Zealand Small Business Loans
New Zealand unsecured loans provides amounts between $5,000 and $100,000. The terms range between 3 and 24 month and cash flow-friendly repayments which can be made daily or weekly.
What makes what makes the Unsecured Loan different from an ordinary company loan?
The application for your Small Business Loan in under 10 minutes over the phone. You’ll get an answer within the same day and the money could be in your account within 24 hours. Traditional business loans have an interest rate per annum along with other charges and fees. This company loan is a pre-paid loan and you’ll be aware of the total amount due, which includes any fees, charges or charges. This is then broken down into weekly or daily payment amount.
What could you use the Small Business Loan be used for?
A Small Business Loan can be used for nearly any business use, including cash flow management, business remodels and marketing for purchasing inventory or new equipment, for general working capital and much more. The loan is not available for personal use.
About larger New Zealand Business Loans
What is the Larger New Zealand Business Loan?
The Larger Business Loan is a larger amount of loan to help business growth opportunities. The loan ranges from $100,000 to $500,000 over a fixed term up to 36 months. The repayments are made weekly or fortnightly in order to accommodate you cashflow.
How is the Origination Fee determined?
It is crucial to note that the Larger Business Loan has an Origination Fee which is determined at 2.5 percentage of the amount of the loan.
Am I eligible for the Larger Business Loan?
To qualify for a loan of this size the business needs to be trading for at least 3 years and have an annual turnover of at least $700K. Your business must belong to a New Zealand Citizen (or Permanent Resident) at least 18 years old, own a New Zealand company (with a valid NZBN/IRD) and be able to prove at the least 12 months of operating.
What can I use the funds for?
A large business loan can be used for nearly every business purpose including business renovations, to purchase inventory or new equipment for general working capital and much more. The loan cannot be used for personal use.
Is the Larger Business Loan one that requires security?
Asset security is needed to obtain funding above $150,000. This is by taking a charge on assets, and could include registering this in the PPSR or making as a caveat.
A personal or director’s ensure is a commitment to repay credit that is generally in nature rather than specifying the security of a specific asset. The person signing the ensure is personally liable in the event that the company the borrower fails to repay the debt.
The Personal Property Securities Register (PPSR) is an online, central registry run by the New Zealand Government. It reflects security interests granted to individuals who own personal property (including objects or assets). The PPSR allows priority over personal property to be granted depending on the date that a security interest that is registered.
The caveat can be described as a formal document that is filed to provide notice of a legal claim to a property.
What is a pre-approval minus Credit Check?
If you’re applying for an enterprise loan of $250K or more we may be able to provide an initial pre-approval in order to ease the process. We might be able to make this decision without credit checks and within six hours of your initial application. The pre-approval is based upon an initial assessment, which involves you answering a few financial health questions. It is not an offer of credit or guarantee of credit. Acceptance without condition is subject to a full credit assessment and any offer that you receive could be on different conditions.
The application process
Are I eligible for funding?
You are eligible to apply for an company loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are 18 years or older, have a New Zealand company (with a valid NZBN/IRD)
- you must prove at least 6 months of business (for the unsecured loan $5K – $100K) or three years of trade (for the Larger Business Loan $100K or $500K)
How do I apply?
The application process is fast and easy. Just complete the online application in few minutes and a dedicated business loan specialist will contact you to assist you.
To apply for up $100,000 you’ll require identification details (valid Driver’s License) and a valid NZBN/IRD as well as at least six months worth of bank statements.
In addition, for larger loan sizes, you’ll also require:
$100K to $250K: Information about the application including credit approval, 6-12 months of IRD statements, bank statements (if the loan is greater than $150K).
$250K to $500K: Details of the application, including credit consent as well as 12 months of bank records, IRD statement and the last two years’ finalised financial statements, in addition to interim current financial year financials as well as Aged Payables and Receivables reports.
How soon will I hear a decision?
For an unsecured loan ($5K up to $100,000) we usually provide an answer within an hour – as long as you apply at quality company timings and allow us to utilise the advanced bank verification system link to immediately verify your bank account information online. If you want to send us copies of your bank statements we can offer the decision in just 1 company day.
If you are applying for a Larger Business Loan ($100K and up) we may be able to provide the conditional pre-approval within about 6 hours. After you’ve signed the pre-approval document, you will require to wait approximately 2-3 days to receive final approval, however this can be quicker based on the circumstances of each application. Certain offers have been approved within 24 hours.
The most efficient method for you to apply is ensure you apply during standard company hours. You can also allow us to use our modern bank verification to verify your bank information online. If you choose to upload the copies of bank statement, it may take a bit longer.
How quickly will I receive the money?
For the Small Business Loan ($5K and up) we usually provide a response in one hour – as long as you apply in standard business hours and allow us to use the advanced bank verification system to instantly verify your bank’s information online. If you decide to submit copies of your bank statements we can provide the decision in as little as an business day.
If you are applying for Larger Business Loans ($100K to $500K) we may be capable of provide you with conditional pre-approval within about 6 hours. Once you have signed the pre-approval document, you will need to wait between 2 and 3 days for the final approval, however it could be faster based upon the circumstances for each application. Certain agreements have been approved within just 24 hours.
The fastest way is to make sure you apply during normal business hours. You can also allow us to use our advanced bank verification system to instantly verify your bank information online. If you send us copies of your bank statements it will take a little longer.
What’s the minimum amount I can borrow?
We offer loans ranging from $5,000 and $500,000. When you submit an application for a certain amount, we consider a variety of factors to determine how much we can lend you health for your business and the amount of the repayments your company is able to afford. The amount you receive from your loan will depend on the specific circumstances that are unique to your company.
When you submit an application for a set amount, we look at a range of variables to determine your well-being that is your company as well as the amount of the repayments your business can support. The total amount of the loan will be determined by the specifics the company.
Fees & repayments
How much should you charge for a business loan?
When you request business loans with us company financing, we will assess the risk assessment the company and provide you with a tailored offer that includes the loan amount, the terms and the interest rates. The business loan is a loan that is priced upfront therefore you will know in advance the total amount to be paid, including any charges, interest rates or fees.
What determines the amount I’m charged?
The interest rates on business loans rates depend on several factors including the amount of money borrowed, the company assets the money will be used for in addition to the industry that the company is in, how long the company has been operating as well as whether the business has enough cash flow to cover the loan, and overall health or financial standing of the business.
What are the charges?
There are no hidden fees for our company loans, and you’ll know precisely how much you’ll be required to pay and at what time, from the first day. There’s no compounding and no additional fees (as long as you are able to make your payments on time).
We do not charge an Application Fee. You can apply for a loan with with no upfront cost or the obligation to take action.
The Origination Fee covers the costs associated with the setting up and management of the loan. You are only charged this fee if you proceed with the loan. Our Origination Fee is 2.5 percentage of the loan amount.
Can I repay the loan earlier?
You can decide to repay the entire amount of the loan at any point in time.
If you are deciding to pursue this option, please contact our helpful company credit specialists. They will offer you with the details of your repayment and an early payout figure. It will be calculated using the total of the principal balance and accrued interest to the time of the early payout plus 1.5 percent of the principal balance and any fees that remain unpaid.
What is the process for repayments?
To make sure you do not miss payments and to work with your cash flow cycle we offer repayments that are either daily or weekly. They will be automatically deducted from your nominated company account.
Security & privacy
Will my information be secure?
Making sure that your information is secure, and being clear about how we collect, use, exchange and secure your information, is of paramount importance and an integral element of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We employ industry-recognised encryption protocols to safeguard your sensitive, personal financial information and our funders are ISO 27001 qualified for our dedication to the security of our customers as well as their privacy. We employ an exceptionally sophisticated bank verification system that allows you to instantly verify your bank account details online to provide rapid response.
About business loans
What is asset-based borrowing (a secured loan)?
Asset-based borrowing occurs when a business owner borrows from the assets they have to get the loan. The asset can be a personal asset like the family home, or an company asset such as a vehicle or piece of equipment.
The majority of lenders, not just the largest banks, are inclined to make loans secured by an asset. If you have trouble paying back the loan then the asset might be taken over by the lender. In essence it’s a way of securing additional financing making use of the value of what you already have.
Do I require security for a company loan?
Up to $150K in loans no asset security is required before you are able to access the money However, we require a personal guarantee. require a personal guarantee. In the event that you fulfill the loan terms (as stated in the loan contract) the security of assets is not required. For loans over $150K generally, you can get an individual ensure and security in the form the charge of assets.
